SupremeToday Landscape Ad
Back
Next
Judicial Analysis Court Copy Headnote Facts Arguments Court observation
Listen Article Pause Article
judgment-img

1957 Supreme(All) 22

IN THE HIGH COURT OF ALLAHABAD
C. B. Agarwala, J.
MADAN LAL - Appellant
Versus
CHAWLA BANK LTD. - Respondents
Civil Revision 1296 Of 1951
Decided On : 01/16/1957

Advocates Appeared:
J.N.Waghrey, L.CHANDRA, S.B.Chaudhary

Headnote:

JURISDICTION - CONTRACT - PLACE OF PAYMENT - IMPLIED AGREEMENT - SECTION 20, CODE OF CIVIL PROCEDURE, 1908 - SECTION 49, INDIAN CONTRACT ACT, 1872 - Where a contract is silent on the place of payment, the place where the contract was made or the place where it is to be performed is the place of payment. In the absence of an express or implied agreement, the place of payment is the place of residence of the creditor at the time the contract was made.

Fact of the Case:

Plaintiff, a joint stock company incorporated under the Indian Companies Act, filed a suit for recovery of money due from the defendant on the basis of a cash credit account opened at Kohat, Pakistan. The defendant had migrated to India and was living at Jullunder. The plaintiff claimed jurisdiction at Dehradun, where it had shifted its business after partition of India, alleging that there was no specific place of payment mentioned in the contract.

Finding of the Court:

The court held that the suit was not cognizable at Dehradun. It found that the contract was made at Kohat, Pakistan, and the money was advanced and payments were made there. The court held that the implied agreement between the parties was that the payment was to be made at Kohat.

Issues: 1. Whether the suit was cognizable at Dehradun, where the plaintiff had shifted its business after partition of India? 2. Whether the place of payment was Dehradun or Kohat, Pakistan, where the contract was made and payments were made?

Ratio Decidendi: 1. Section 20 of the Code of Civil Procedure, 1908, governs the jurisdiction of courts in cases based on contracts. A suit can be filed either at the place where the defendant resides or at the place where the cause of action wholly or in part arises. 2. Section 49 of the Indian Contract Act, 1872, provides that where a promise is to be performed without application by the promisee and no place is fixed for the performance of it, it is the duty of the promisor to apply to the promisee to appoint a reasonable place for the performance of the promise and to perform it at such place. 3. In the absence of an express or implied agreement, the place of payment is the place of residence of the creditor at the time the contract was made.

Final Decision: The court allowed the revision application, set aside the order of the lower appellate court, and restored the order of the trial court. The plaint was returned to the plaintiff for presentation to the proper court.

C. B. AGARWALA, J.

( 1 ) THIS is a defendants application in revision under Section 115 of the Code of Civil Procedure arising out of a suit for recovery of a sum of money.

( 2 ) THE plaintiff opposite party is a joint stock company incorporated under the Indian Companies act. It used to carry on its business in the N. W. F Province and after partition of India its business was shifted to Dehra Dun. The defendant-applicant had opened a cash credit account with the company at its branch at Kohat in Pakistan. The defendant also migrated to India and is living at Jullunder. The plaintiff filed a suit for the recovery of the sum due from the defendant applicant on the basis of the cash credit account, at Dehra Dun, the place where the company now carries on business. It was alleged by the plaintiff company that there was no specific place of payment mentioned in the contract between the parties and as such it was the duty of the debtor to find his creditor and so the court at Dehra Dun had jurisdiction to try the suit. The defendant contested the suit and one of the preliminary issues raised by him was that the suit was not cognizable by the court at dehra Dun. The trial court held that the suit was not cognizable by it and returned the plaint for presentation to the proper court. The plaintiff appealed to the lower appellate court which held that the suit was cognizable at Dehra Dun in the trial court and consequently it allowed the appeal and remanded the case to the Court below for decision on the merits. Against this order the defendant has come up in re-vision to this Court.

( 3 ) THE agreement for cash credit account was executed by the defendant on 3-9-1948, at Kohat in pakistan. No specific place for payment of the amount due to the plaintiff company was mentioned in the agreement, but the fact remains that the money was advanced at Kohat at the branch of the plaintiff company and payments from time to time were also made by the defendant-applicant at Kohat. No payments were made at Dehra Dun. The plain-tiff company after it had shifted to India notified to the defendant-applicant that payment should be made at dehra Dun, but no payment was made by the defendant. Hence the plaintiff filed the suit at dehra Dun.

( 4 ) ON these facts the question is whether the plaintiff was entitled to bring the suit at Dehra Dun. The jurisdiction of the court in cases based on con-tracts is governed by Section 20 of the Code of Civil Procedure. Section 20 runs as follows :

"subject to the limitations aforesaid, every suit shall be instituted in a court within the local limits of whose jurisdiction -

(a) the defendant, or each of the defendants where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain or

(b) any of the defendants, where there are more than one at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain, provided that in such case either the leave of the court is given, or the defendants who do not reside, or carry on business, or personally work for gain, as aforesaid, acquiesce in such institution; or

(c) the cause of action, wholly or in part, arises". Section 49 of the Indian Contract Act provides. " where a promise is to be performed without application by the promisee and no place is fixed for the performance of it, it is the duty of the promisor to apply to the promisee to appoint a reasonable place for the performance of the promise and to perform it at such place. "

( 5 ) IT is urged by learned counsel for the plaintiff opposite party that the English Common Law principle that the debtor must seek his creditor applies to India. Whether the rule applies or not to India in all its aspects, it cannot override the statute. e. , Section 20 of the Code of Civil procedure under which a suit has to be filed either at the place where the defendant resides






















Click Here to Read the rest of this document

1
2
3
4
5
6
7
8
9
10
11
SupremeToday Portrait Ad
supreme today icon
whatsapp-icon Back to top